In April 2023, Mastercard announced its plan to pursue sustainable cards by 2028, but that decision has prompted a number of questions and assumptions concerning this transition.
Payment cards have come a long way since their inception. Today, these small plastic wonders are equipped with advanced microchips, wire antennas for contactless transactions, and holograms to combat counterfeiting. However, despite these technological advancements, one aspect has remained largely unchanged — the plastic itself. Most payment cards are made from non-biodegradable materials like PVC, resulting in billions of cards ending up in landfills worldwide. To address this environmental issue, the payment card industry is now focusing on sustainability initiatives.
Recognizing the urgent need for change, Mastercard, amongst other industry leaders, is taking proactive steps to reduce its impact on the environment. One notable initiative is the decision to transition to sustainable materials for all new payment cards by 2028.
This move aims to address the challenges associated with recycling traditional plastic cards due to the presence of embedded metals and other non-recyclable materials. Additionally, companies are actively promoting the shift towards digital payments through innovative programs like Digital First, allowing cardholders to opt for virtual cards instead of physical ones.
The vision for the future of payment cards involves easy and widespread card recycling. Collaborative efforts are underway to establish a blueprint for efficient card recycling systems globally. These initiatives encompass every aspect of the process, including collection, transportation, and recycling. To kick-start this movement, partnerships with financial institutions have been established, starting with HSBC in the United Kingdom, which now offers card recycling at select branches.
The card recycling process begins with cardholders dropping off their expired payment cards in secure collection boxes located inside bank branches. For added security, the cards are shredded on-site, ensuring that no card information can be compromised and the embedded chip is destroyed.
The shredded waste is then sent to recycling partners who specialize in handling hard-to-recycle products. In the case of the U.K., TerraCycle has been enlisted to separate the shredded card waste and reform the plastic into pellets and powders for reuse in other products.
In pursuit of sustainable card manufacturing, companies have invested in research and development. Dedicated laboratories have been established to analyze the physical and chemical composition of plastic cards, employing techniques such as gnashing, grinding, and cross-sectional examinations under advanced microscopes. This meticulous scrutiny enables the identification of sustainable materials and manufacturing methods that minimize energy consumption, carbon emissions, and waste. Cards meeting these stringent sustainability criteria receive an eco-friendly badge of approval.
The progress towards sustainability is already underway, with more than 403 financial institutions and fintech companies from 92 countries joining the cause. Since 2021, they have issued 235 million Mastercard cards made from recycled, recyclable, and bio-sourced materials. These materials include recycled ocean plastic and bioplastics derived from renewable sources like sugar or corn.
To accelerate the sustainability movement, all card issuers are urged to collaborate and provide recycling solutions for existing first-use plastic cards.
Companies like Mastercard are offering their expertise and connecting issuers with recycling partners to facilitate the implementation of their own recycling programs. By leveraging existing infrastructure, these programs can maximize their impact with minimal cost and effort.
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